The Fine Art of Targeting

By Chris Gaebler

My mother-in-law has a great expression.  In the family we call it, “updating your prior.”  What it means is that you always have to remember to update your prior view of things, because otherwise you are making false assumptions based on outdated information.

As marketers we often fall into the trap of neglecting to “update our prior.” We pick a demographic and a target profile, and we stick with it. This is natural byproduct of having studied and chased after a singular customer segment for many years. Over time, however, customer needs may have changed, and new prospects may have emerged unnoticed. Examples of this tendency include industries like automotive and electronics.  In these markets brands have been targeting men forever, not realizing that the wife in the family may be the primary decision-makers for household purchase decisions. Unfortunately, a narrow focus on demographics can cause marketers to miss critical shifts in their audience profiles.

A recent study by Microsoft confirms this theory.  The study shows that premium brands have been missing up to 50% of their best audience by relying too heavily on targeting only to the affluent. Purchase behavior turned out to be a more important indicator than affluence.  In fact, 43% of online customers in Europe are premium buyers, yet this group is not affluent by any traditional measure.

So what are some of the other reasons marketers may be missing their targets?

1. Customers Are a Moving Target

Changing habits and overlapping interests and hobbies can sometimes be hard to correlate with buying behavior. While there is a preponderance of information available on the Web, many data providers offer a limited view of the user.  With the right audience measurement tools, however, marketers can put the pieces together to create a coherent picture.  A story in Ad Exchanger describes a marketer targeting home-based business users with children.  In order to reach this demographic, he had to combine data for micro-business users, home-based users, and households with children from three separate data providers. Scaling audiences can be particularly difficult without the ability to normalize and aggregate audience profiles in one place. Using web-based tools to measure who is engaging with your messaging and who is responding to your offers will give you a better view of a larger potential customer pool.

2. Aiming at the Wrong Target

Products are often delivered to market with preconceived expectations about who the audience will be.  When David Roberts, the CEO of PopCap launched a game called Bejeweled on Facebook, he fully expected the game to appeal to a young male audience.  Instead, he was astounded to learn that 70% of the game players were women.  The social aspect of the game was an attraction for young mothers who were stuck at home, and wanted to play and interact with friends and family.  I’m not sure why anyone thought a game called Bejeweled would be a magnet for young males, but never mind. The company had to integrate this new view of its customers into its marketing strategy.

3. The Unintended Target

Toyota Scion was a car designed specifically to appeal to a youth segment with a focus on customizable features and a low price.  The original target was young people, 20-25 years old, and Scion avoided the Toyota brand name because they felt it was too ‘old’.  Toyota soon discovered that the Scion appealed simultaneously to both millennial upstarts and empty-nest boomers.  Auto makers now are looking to replicate this model and design more Twin Peaks Cars. That is, cars that have two peaks in a line graph of the age distribution of the buyers.

So how can brands best identify and consistently maintain the right targeting?

The key to developing good market targets is to be clear on your segmentation strategy, and then market specifically to those targets. But don’t fall in love with a target profile, be flexible and ready to make changes based on updated data.  Ideally, marketers should measure customers based on three yardsticks, behavioral, transactional, and demographic. Behavioral marketing allows brands to identify their highest value segments.  Transactional data allows marketers to revisit their current customer profile to see if anything has changed.  Demographic data makes it easy for brands to understand their audience and identify customers.

Marketers need to learn how to optimize marketing based on business intelligence gathered during the campaign.  The real-time technology platforms that enable audience measurement and campaign management provide an advantage to the marketer.   Those platforms, coupled with smart targeting techniques, create a new opportunity for greater scale and efficiency in online marketing.  Marketers can discover new customers by using audience measurement that provides more insight into those responding to your message. In other words, sometimes you just need to update your prior.